Health Law a Growing Legal Practice

James Hall recently returned from a conference of the National
Health Lawyers Association with 40 pounds of literature about the
rapidly changing health care industry.

Hall, who earlier this month was elected president of the
largest organization for attorneys specializing in health law,
spends on average two hours a day reading about legal matters
that affect health care.

His law firm, Crowe Dunlevy, has seen its health care
section grow by an average of 25 percent annually during the past
five years. Hall and five other Crowe Dunlevy attorneys
specialize in health care cases, and another 20 attorneys provide
support on health care deals when real estate, tax, antitrust,
regulatory and labor issues arise.

"Health care is probably this country's biggest industry, and
health law is a growing field. Health law requires a bit more
currency than some other specialties because it is more dynamic.
It moves rather quickly because there is so much government
involvement in such areas as Medicare."

One recent change is an Internal Revenue Service ruling last
month on tax-exempt status for nonprofit hospitals. The ruling
affects how nonprofit hospitals recruit physicians. Hospitals who
use lavish incentives to lure physicians in specialties that are
not needed in the community could be in danger of losing their
tax-exempt status, Hall said.

The trend toward managed care also requires knowledge of
antitrust laws and rulings from the Federal Trade Commission and
the U.S. Justice Department on vertical integration of entities.

"Managed care is a vertical integration. Because with managed
care you are forming relationships that include some doctors and
exclude others, you automatically are facing antitrust issues."

Even changes in state law can have a major impact on a health
care deal. About three years ago, a new state law allowed for
limited liability companies.

Several months ago, when the physician hospital organizations
at four Oklahoma City hospitals combined into one "super PHO" the
new entity opted to be a limited liability company. One reason:
two of the hospitals were tax-exempt and two were for profit.

Because a limited liability is similar to a partnership,
physician hospital organizations at each of the four hospitals _
Baptist Medical Center, Presbyterian Hospital, Southwest Medical
Center and Deaconess Hospital _ could continue to operate
financially as either a for-profit or a tax-exempt organization. …

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